SAP WM- Process, Functionality, Scope, Benefits, Advantages, Disadvantage-Complete Reference-Part 3:- Continuation of Part 1 &  Part 2.

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Topics Covered in this Article

  1. Warehouse Basic Functionality

  2. SAP WM Integration with other SAP Modules.

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Many persons asking Questions how an actual Warehouse Function in a real time. So here i am having compulsion to explain the Warehouse Concept once again and i hope it requires schematic Warehouse layout. In general the Warehouse layout vary based on the client business Process or the Warehouse designed who structured the Warehouse and purpose of Warehouse – it may be full operated Warehouse or a distribution center.

  • A Distribution Center (DC) is a warehouse where the products from various supply points are received and (value added) processes like consolidation, break pack and re-palletization and cross-docking are carried out to reduce the distribution costs and increase supply chain efficiency. In simple terms, its main function is distribution rather than storage.

  • One DC may include one of more physical warehouses.

  • Manages warehouse inventory, space, equipment, and labor resources to direct the flow of materials and information from receiving and putaway to light assembly, order picking, value-added processing and shipment.

  • Warehouse design criteria address physical facility characteristics and product movement.

  • Three factors to be considered in the design process are:

    • the number of storey’s in the facility,

    • height utilization (Maximize Height), and Minimize Aisles

    • product flow.

    • Efficient Materials Handling

    • Effective storage Plan

Normally in any Warehouse Main Layout Objectives

  • Maximizing Warehouse Capacity

  • Efficiency of Warehouse Movements

  • Maximizing Productivity

Site Selection is very Important in any Warehouse setup/ Design Phase

  • Location analysis techniques are available to assist in selecting a general area for warehouse location.

  • Once location analysis is completed, a specific building site must be selected.

  • Three areas in a community may be considered for location:

    • 1) commercial zones, 2) outlying areas served by motor truck only, and 3) central or downtown areas.

  • The primary factors in site selection are the availability of services and cost.

  • The cost of procurement is the most important factor governing site selection.

  • A warehouse need not be located in a major industrial area.

  • In many cities, one observes warehouses among industrial plants and in areas zoned for light or heavy industry.

  • Interestingly, this is not a legal necessity because most warehouses can operate under the restrictions placed on commercial property.

  • A warehouse need not be located in a major industrial area.

  • If pallets are to be utilized, the first step is to determine the pallet size.

  • A pallet of nonstandard size may be desirable for specialized products, but whenever possible, standardized pallets should be used because of their lower cost.

  • The most common sizes are 40 by 48 inches and 32 by 40 inches.

  • In general, the larger the pallet load, the lower the cost of movement per package over a given distance.

  • The packages to be placed on the pallet and the related patterns will determine, to a certain extent, the size of pallet best suited to the operation.

  • Regardless of the size finally selected, management should adopt one size for the total operation.

  • The second step in planning a layout involves the pallet positioning.

  • The basic method of positioning pallets in a mechanized warehouse is a ninety-degree, or square, placement.

  • Square placement means that the pallet is positioned perpendicular to the aisle.

  • The square method is widely used because of layout ease.

Each Product is having Specific Focus in their Design. But among this SAP WM & EWM will have significant importance and it covers all Warehouse Day to Day Operation and Data is more perfect, Accurate & Flexible control over Inventory.

Why WM requires?

Many People will have a Question in mind à  why a company would need/want to use WM instead of just IM.
Lot of factors go in before a decision on this can be made. In a nutshell:

1. whether tracking material at storage bin/ quant level is required
2. Are materials handled in different units within the plant?
3. Whether there are different people/process involved from the time a material arrives at the gate till it is stored and vice-versa (Goods issue process)
4. Whether dangerous / hazardous goods are maintained.
5. RF / Bar-coding?
6. Overall complexity if only IM is activated. (ex: picking a material / performing physical inventory etc.)

Not only above mentioned advantage with SAP WM. We are having many more advantages described in coming chapters.

Even when I am working my clients & users are asking why we need SAP WM if we have already IM in Place (Where MM is already in Place.) & also some clients asking we already have SAP WM and why we need to continue SAP WM when SAP MM is more comfortable for Inventory Stock management.

We can say that they already have SAP WM:
1) Is it working well for them?
2) Are the users properly trained?
3) Are the users able to run the WM System without a substantial level of IT or External Consulting support?
4) What would the effort be for them to switch back to a Non-WM Managed Storage Location?

It is my guess that if they are considering moving back to a Non-WM environment, that either:
A) They didn’t need WM in the first place and it was initially specified falsely for their requirements or
B) They need WM, but they never organized enough training, or the critical mass of disciplined users, which is required to run a smooth WM system.

I cannot say Handling SAP MM is not good but when Warehouse Size matters and if operation requires more critical and automation required with minimum time in handling Stock placement & Removal and to handle various customer @ same time during peak Receipt & issue operation. SAP WM will help more to the business users.

WM can give you certainly more tight control than MM-IM, because a movement (transfer order) has to be confirmed after the transfer has been done.
WM creates the paper work for Transfer orders. It is my opinion, and perhaps a philosophical one that making more storage locations in one plant to handles different stock Types is very Robust and no experienced and expertise consultants will suggest (Maintaining Stock with more number of Storage location @ IM Level). The idea is to avoid making 20, 50, or 100 Storage Locations in one plant to avoid implementing WM is not good enough. Here SAP WM places a vital role. SAP WM can handle various kind of stocks at very ease step. Also putaway & Picking and Internal WM movements are nowadays automated and very minimum time required between Warehouse Operations. So it removes the thinking when SAP WM is implemented it is more complex for users to handle and more time required to complete the business operation and lot more down time required. I hope by reading these SAP WM Article users, Super users & Consultants will get an Positive/ Practical approach towards SAP WM.

 

 Warehouse Layout- Schematic View of Warehouse locations  and related operation- Receiving location,  Quality Inspection, then Goods are received in the Processing area, Putaway, Here Movement of Material depends on the client business process and Management Decision and Policy, Physical & Chemical, Direct /Indirect Properties,  type of the material handled. Many other factors influencing the selection of the Putaway path or Picking Path.

Picking Stock is moved to Outbound -Quality Inspection then moved it GI processing Area, staging  Area, Consolidation area and then loading and then moved to Dispatch Center for loading the Truck. We can see Flow Through Picking, VAS, Reserve and Pick Areas, Replenishment Zone. We can say It is an complete Warehouse. Process depends on client existing Practices. What I meant here is Flow of materials inside Warehouse depends on client decision and likes.

Additional/Advanced Warehouse operations

Yard Management and Appointment scheduling

Quality Checking

Inventory Control (Stock Take, Cycle count)

Value Added Services – Special packing, assembling kits, break packing.

Cross-docking

Reverse Logistics Management – Processing for Re-distribute/refurbish/recycle/scrap.

Here  is simple Flow of Inbound & Outbound

Appointment and Yard Management

  • Appointment Scheduling for delivery (or Pickup)

    • Supplier, 3PL, DC, Own Transportation, Customer
  • Dock and Door assignment to the delivering truck along with the appointment time.
    • Delivery document (PO or other purchase delivery detail)
    • Availability of Dock/Door
  • Yard Management

    • Truck/trailer placement for waiting, unloading, loading (shipping)
    • Effective Yard Space Management
    • Demurrage
  • Appointment delays

    • Appointment Reschedule
    • Yard Management
    • Supplier Performance

SAP Warehouse Management (SAP WM) is a component of SAP Logistics Execution system (SAP LE) and deals with the following tasks: Inventory management in randomly-organized and fixed-bin storage types; Processing all relevant movements and tasks in the warehouse, such as goods receipt, goods issue, movements within the warehouse. The WM application component is not installed as a stand-alone solution, but is integrated in all areas of the SAP business system (such as MM, SD, PP, QM, and TM). Based on the complexity of the warehouse operations and the business requirements, a Lean WM, or a standard WM or a Decentralised WM or an Extended WM can be selected for implementation.

Functions in WM Application Components include-

WM Inbound: Receipt, inspection, and putaway of inventory (receipt, interface to quality inspection, putaway)

Inbound Processing

Receiving

  • PO, ASN
  • Unload, Re-Palletizing, Labeling
  • Receipt Creation, Corrections
  • Rejections
    • Damaged
    • Excess Quantity
    • Product Not Ordered
    • Product outside date window (expiry, life)
  • Express Receiving/Trusted Supplier Receiving
  • EDI
  • QA, Special Process.

Putaway

  • Created in Receiving
  • System driven and user driven Putaway
  • Putaway tasks
    • Regular Putaway
      • To Reserve, Pick, Bulk storage, staging
    • Cross-dock moves
    • Flow through moves
  • Putaway rule configuration based on product attributes, location attributes, distribution strategies.

E.g.

  • Empty pick locations are preferable over reserve locations as putaway destination for selected products
  • If open full pallet pick exists for same products with similar attribute, close full pallet pick and move received product directly to staging lane of shipping dock.

WMS Functions in Detail

  • Receiving

    • Blind

    • ASN/EDI

    • Conventional or Automatic

  • Putaway

    • Dedicated, Random or Hybrid

    • Location Selection: System or Operator

    • Put Confirmation

  • Picking and Shipping

    • Pick by Order, Batch, Wave

    • Pick Confirmation

    • Shipping Check Lists

    • Manifests, Bills of Lading

Creating a Responsive WMS

  • Use contemporary ADC technology and systems to assure

    • Accurate execution of receiving, storage, and move tasks
    • Error-free picking, replenishment, and shipping
    • Traceability
  • Provide seamless interfaces to other corporate systems to assure

    • Real-time visibility of inventory availability
      • by SKU, quantity, lot number, serial number and shelf life by location
    • Real-time order confirmation and status for customers
    • Event-driven exception handling
  • Facilitate a quick match of available resources to current and expected inbound, replenishment, and outbound workload
    • Select the best operators and equipment for tasks based upon proximity, skill sets and priority
    • Task operators to immediately store or cross-dock receipts.
    • Support returns processing and reverse logistics
    • Use task interleaving to minimize deadheading
    • Improve order consolidation, wave planning, inventory allocation, and pick sequencing
    • Identify consolidation opportunities to free space and reduce outside storage requirements
    • Support bill of material, work order, and value-added processing
    • Update inventory records as events occur
    • Provide accuracy that allows replacement of full physicals with scheduled cycle counts
    • Time stamp each transaction and identify the operator who performed it
    • Provide feedback to the workforce and support performance measurement

Measure supplier and carrier performance

Warehouse arranging the pallets

 

Forklift Operations.

Locations

  • Location levels

    • Zone
    • Aisle
    • Level
    • Bin
    • Location ID
    • g AA – 01 – 04 (Aisle – Level – Bin)
  • Location Types

    • Reserve
    • Case Pick
    • Unit Pick
    • Bulk storage location
    • Abandon/issue zone
    • Special areas (Goods in, shipping, special processing, hazardous, fast pick, promotions, flow through, cross dock).

Order Processing is Determined by Following Factors

  • Order Type

    • Store
    • Customer
    • Other DCs (transfers)
  • Order grouping (wave)

    • Product availability
    • Picking volume
    • Delivery date & time
  • Order grouping (wave)

    • Staging Lane, Shipping Dock, Door
    • Pick methods, techniques
    • Packaging details
  • Order Release/processing

    • Create picks (units and case picks)
    • Create full pallet picks
    • Create replenishments
    • Create Loading

Picking

Picking Technique

  • Order Picking
  • Batch picking or Line picking
  • Full Pallet or bulk storage picks

Picking Method

  • Paper picking – Pick list, label
  • RF picking
  • Voice picking
  • Wearables picking
  • Pick to light

Other picking classifications

  • Man to product (AGV, Manual)
  • Product to man (Carousels, A-Frame)

Picking

  • Pick sequencing
  • Pick task grouping
    • Zone, hazardous materials, packing containers, restricted products, Packing instructions

Shorts Management

  • Delayed pick
  • Markouts
  • Event Driven Count

Replenishment (Within DC/Warehouse)

  • Replenishment

–Reserve to pick (case/unit)

–Replenishment triggers

  • stock level, pick requirements

–Prioritization

  • Before pick

  • After pick

–Residue return

  • Lean Time Replenishment

Note: In Retail there are two replenishments.

1.Store replenishment (WH- Store)

2.Warehouse replenishment (Within warehouse).

Packing, Sorting and VAS

  • Packing

–Packing or palletizing of picked products

  • Sorting

–Sorting and packing/palletizing

–Conveyor sorting, manual sorting

  • VAS

–Kits assembling or grouping

–Special packaging

 

  • Consolidation

–Within order or shipment – partial pallets

–Consolidating cross-docked pallets to picked pallets

–Effective packing – Space savings

–Ergonomic rules

–Product handling constraints

Loading

  • TL/LTL

–Pick and pack complete

–Assign trailer/truck

–Load optimization (mostly outside WMS)

–Consolidation of shipments (as per load optimization)

–Load the packed products (pallets, roll cages, etc)

–Seal Trailer

–Close Trailer

–Create outbound delivery notice, Bill of Lading (BOL).

  • Parcel

–Pick and pack complete

–Manifest

–Load

Inventory Control

  • Physical Stock take

–Once in a year

–Complete Warehouse

  • Cycle Count

–Specific areas/Sections of warehouse

–Periodic

  • ABC Classification

–Fast moving, high value, slow moving, slow value

–Event Driven

  • Zero pick, miss pick, etc

  • Inventory Adjustments

–Positive and Negative Adjustments

–Reason Codes (Cycle count, damage, theft)

  • Counting

–First count (Blind count)

–Variance Report

–Second count

–Verification and posting

WMS – Labor Standards

  • Attendance System

  • Engineering Standards

–Engineering standards for each warehouse tasks have to measured and configured.

–e.g. Case picking, Piece picking, Pallet handling, Pallet breaking, Forklift Turn, Forklift Travel, Picker travel with various equipment, Battery recharge, Fatigue, other delays

  • Location Co-ordinates, assignment starting point

  • Equipment Safety and other safety standards

  • Expected standard time calculation, at task creation and task execution

  • Incentive programs (Group and individual based on standard time).

WMS – Automations and Future

  • Automation

–Conveyors and Sorters

–Voice

–AS/RS

–Cranes

–Robots

  • Future Advancements

–RFID

–Advanced Robots

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*********I am seeing many people interested in knowing what is the day to day activity or role of any Warehouse Manager in an Warehouse. I have shared this information already in my Part-1 Blog. in this Part 3 blog I am not pointing more techie information but in Simple Warehouse manger is solely responsible for the Warehouse efficiency and Operational success.

Warehouse Manager
Warehouse managers oversee the safe receipt, storage, retrieval and timely dispatch of goods. They ensure workplace health and safety requirements are met and take responsibility for the security of the building and stock.

They plan the arrangement of goods within the warehouse and organize special requirements for certain stock, such as chilled goods or fragile products.

They ensure productivity targets are met and maintain computerized administration and automated storage and retrieval systems.

They manage teams of workers and deal with personnel issues such as the recruitment, training and discipline of staff. Some managers also oversee picking, packing and distribution activity.

Typical work activities

Work activities will depend on the size of the operation:

• In large storage operations, managers have a more strategic role and deal with planning, administration and general management issues, which will include the day-to-day supervision of staff, and overseeing work organized by team leaders (who then report to the manager).

• In a small operation, a manager will do more practical, ‘hands-on’ work.

Typical work activities include:

• motivating, organizing and encouraging teamwork within the workforce to ensure set productivity targets are met;

• training staff and monitoring their performance and progress;

• communicating with other departments, staff groups and customers;

• overseeing stock control and processing orders;

• ensuring quality, delivery and budget objectives are met;

• delivering and fulfilling objectives and directions from the operation’s headquarters;

• carrying out responsibilities for the use of automated and computerized systems;

• responding to and dealing with customer communication by email, fax and telephone;

• keeping stock control systems up to date and planning future capacity requirements;

• producing regular reports and statistics on a daily, weekly and monthly basis;

• briefing team leaders on the issues for that particular day;

• visiting customers to monitor the quality of service they are receiving;

• ensuring the health, safety, cleanliness and security of the work environment;

• Overseeing the planned maintenance of vehicles, machinery and equipment.

 

SAP WM –Process, Functionality, Scope, Benefits, Advantages, Disadvantage- Complete Reference-Part 1

 

SAP WM- Process, Functionality, Scope, Benefits, Advantages, Disadvantage-Complete Reference-Part 2

 

I hope this article helps the consultants to think beyond SAP, solving the Tickets and thinking on IT solutions.I hope many people not having direct touch with a warehouse or they may not see how a Warehouse functions and how warehouse workers respond the client challenges. understanding MM is different from WM. WM requires more understanding on day to day activities. one must visit the Warehouse and need to understand the Operations. without that we cannot learn or get a clear idea on SAP WM. we can just go through and read the Documentation but when you work EWM and complex warehousing process it is difficult to assume the process why TO confirmation is required, why a material is taken through IM method or of WM (creating MIGO–> TR and Quant created in back end and with respect to TR we are creating TO and confirm it. why we require WM -Delivery(SD) Way and why a material is taken to Quality center, Why it is taken to VAS area and directly issued to sagging or consolidation area. Many more Process Involved that requires visualization.

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Continued…. Part 3

SAP WM- Process, Functionality, Scope, Benefits, Advantages, Disadvantage-Complete Reference-Part 3

SAP Inbound Process Flow Diagram

SAP Outbound process Flow

Bin- Bin Transfer

What action is Real time Warehouse Operator or Supervisor action can hit or appear in SAP ? what will they do and what is the sequence of Operation. I hope i have given very detailed manner for some who know the concept or those who worked or experts in SAP WM/ EWM – I hope it will be more boring. but again we need to concentrate on new comers.

1.Scenario on Inbound receipt of Raw Material in WMHU Plant from External Vendor. Ex- Raw Materials. here I like to summarize the system action and user related action.

  • Purchase Order must exist

    • Delivery and Shipment are auto created based on delivery date

    • Shipment is checked in at truck arrival

    • Load list generated

  • Inbound delivery is packed via Mobile device by Receiving Clerk at Gatehouse

    • EAN and Handling units are scanned

    • Handling units are packed

    • Transfer Order is created and sent to Forklift Driver RF Queue for Putaway

    • Truck Driver directed to a door

  • Forklift Driver

    • Directed to Door via RF device

    • From load list, enters delivery into RF device, scans each pallet and directed to bin for putaway

    • Confirms bin

    • Transfer order confirmed with last putaway

  • Goods Receipt is posted for inbound delivery at Shipment Completion

    • Inventory levels are updated to reflect the receipt, material now in storage.

2. Scenario on Inbound receipt of Finished Goods in WMHU Plant from External system.

  • Purchase Order must exist

    • Delivery and Shipment are auto created based on delivery date

    • Shipment is checked in at truck arrival

    • Load list generated

  • Inbound delivery is packed via Mobile device by Receiving Clerk at Gatehouse

    • EAN and Handling units are scanned

    • Handling units are packed

    • Transfer Order is created and sent to Forklift Driver RF Queue for Putaway

    • Truck Driver directed to a door

  • Forklift Driver

    • Directed to door via RF device

    • From load list, enters delivery into RF device, scans each pallet and directed to bin for putaway

    • Confirms bin

    • Transfer order confirmed with last putaway

  • Goods Receipt is posted for inbound delivery at Shipment Completion

    • Inventory levels are updated to reflect the receipt, material now in storage.

3. Scenario- Return to vendor (basically an outbound process)

  • Quality Supervisor

    • Quality Issue identified

    • Mtrl on Hold

    • MIGO_TR

    • Create a Return Purchase order

    • Return PO Delivery created via Batch Job

    • ZEU1 Global IBT Shipment is created via batch job

  • Warehouse

    • Stk Keeper instructs Flt Op to move mtrl for OB Delv to pre-staging

    • Ftl Op proceeds to move material as required

    • Stock Keeper packs HU(s) on OB Delivery.

4. Scenario- STO between Sending Plant and Receiving Plant.

Outbound process in sending plant:

  • Outbound delivery is created for shipping location

    • Purchase order must exists

    • Storage and warehouse view must be active for the material

  • Outbound delivery is picked

    • Transfer orders are created

    • Handling units are generated

    • Warehouse is updated to release the handling units from the storage bin

  • Goods Issue is posted for outbound delivery

    • Inventory levels are updated to reflect the release of inventory

  • Inbound delivery is created for receiving location

    • Handling unit information is automatically transferred from outbound delivery

    • Storage and warehouse view must be active for material

    • Inbound process in receiving plant:.

  • Purchase Order must exist

    • Inbound delivery created based on outbound

    • Shipment created

    • Shipment checked in at truck arrival

    • Load list generated

    • Handling units are already packed

    • Transfer Order is created and sent to Forklift Driver RF Queue for Putaway

    • Truck Driver directed to a door

  • Forklift Driver

    • Directed to door via RF device

    • From load list, enters delivery into RF device, scans each pallet and directed to bin for putaway

    • Confirms bin

    • Transfer order confirmed with last putaway

  • Goods Receipt is posted for inbound delivery at Shipment Completion

  • Inventory levels are updated to reflect the receipt, material now in storage

5. Scenario- GI of Raw Material to production – WMHU

  • Outbound delivery

    • Created by Production from Process Order

    • Transfer order is created

    • Transfer order to forklift queue

  • Forklift driver processes the transfer order

    • Directed to bin for material

    • Confirms placement at specified line

 

6. Scenario -GI of Raw Material to production – WM non-HU

  • Transfer Order

    • Created by Production from Process Order

    • Transfer order to forklift queue

  • Forklift driver processes the transfer order

    • Directed to bin for material

    • Confirms quantity

    • Confirms placement at specified line.

 

7. Scenario:- Raw Material Return– WM HU Managed Location.

  • Inbound Delivery

    • Created by Production

    • Handling Unit is packed

    • Transfer order is created

  • Forklift driver processes the transfer order

    • Directed to Production Line

    • HU scanned

    • Directed to bin for putaway

    • Transfer order is confirmed

      • Confirms placement in bin

8. Scenario   Raw Material Return  WM Non HU Locations means WM without HU Management.

  • Inbound Delivery

    • Created by Production

    • Transfer order is created

  • Forklift driver processes the transfer order

    • Directed to Production Line

    • Confirm quantity

    • Directed to bin for putaway

    • Transfer order is confirmed

      • Confirms placement in bin

9. Scenario   Bin to Bin movement– HU Management

  • Warehouse generates transfer order(s) in SAP

  • Transfer order is sent to Forklift Operator queue

  • Forklift Operator goes to specified bin

  • Forklift Operator moves specified HU(s)

  • Forklift Operator confirms HU(s) moved to new bin successfully.

  • Process to un-assign / unpack / delete a HU from a delivery

 

    • Unassign: The HU can be unassigned from the delivery in the change mode VL02N using the packing tab and using the delete assignment icon.

    • After this before saving the delivery go to the edit tab and use copy pack quantities as delivery quantities, this will set the Picking and the WM status to Blank from complete.

    • You can again go to the delivery and enter the delivery quantity which will again set the status to A (Not yet processed)

  • HU remains in stock as it is after unassigning from the delivery.

    • Unpack: The HU can be unpacked from the delivery in the change mode VL02N using the packing tab and using the Unpack icon.

    • HU remains in stock as it is after unpacking from the delivery but without any material content.

    • Delete: The HU can be deleted from the delivery in the change mode VL02N using the packing tab and using the Delete icon.

  • HU is destroyed from the stock. HU needs to be unpacked first to delete later.

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 SAP WM Integration with Other Modules

Inventory Management

Define Storage Location Control

IMG –>Logistics Execution –> Warehouse Management –>Interfaces –> Inventory Management  –> Define Storage Location Control.

Config parameter:

 Control of Assignment “Plant / Stor.Loc. – Whse Number”:

 

 

Storage loc. ref.:

1.1.1     Define Movement Types

IMG  Logistics Execution  Warehouse Management  Interfaces  Inventory Management   Define Movement Types

Assign WM Movement Type References to IM Movement Types

Config parameter:

LE-WM Interface to Inventory Management

Define Posting Changes

IMG  Logistics Execution  Warehouse Management  Interfaces  Inventory Management   Define Posting Changes

We can have the option to check WM Consistency Check.

The following graphic shows how picking is carried out in conjunction with the SD application:

1.1.1      Shipping

IMG  Logistics Execution  Warehouse Management  Interfaces  Shipping   Define Shipping Control

Define Shipping Control at the Movement Type Level

Config parameter:

Shipping Control per Warehouse Number

Integration to Quality Management

The Warehouse Management (WM) application interface to the Quality Management (QM) component allows warehouse administrators to manage and track inspection lots that are stored in the warehouse.
The primary processes in the interface between WM and QM function as follows:
1.Based on the inspection data in the QM view of the material master, the system can create an inspection lot when you post a goods receipt in the Inventory Management (IM) component. The QM inspection data also determines whether an inspection lot is to be inspected with an inspection plan and determines the quantity of the material that is to be selected as an inspection sample.
2.In WM, the normal process takes place for the goods receipt posting in IM — the system creates a quant in the interim storage area and, depending upon the system definition, a transfer requirement in WM. An inspection lot number is noted in the quant in the interim storage area and in the transfer requirement. The system stores the interim storage bin coordinates in the inspection lot itself.
3.If a usage decision has not yet been made for the inspection lot, the system displays a dialog box to inform you that a sample quantity exists when you process the transfer requirement for the goods receipt in WM. (This dialog box can also be processed in the background.)
4.In QM, a usage decision is made after the inspection has been completed. The resulting postings are passed on via the IM component to WM and there they initiate stock removals or posting changes. For more detailed information, refer to the section Examples: Making a Usage Decision.

Making Stock Placements Using the QM Interface

Once materials have been inspected, a usage decision must be made in the QM component. How transfer requirements are handled varies depending on the situation. For stock placements based on transfer requirements that contain an inspection lot, two different situations exist:
•The usage decision in QM has not yet been made.
•The usage decision in QM has already been made.

For each of these situations, how you process the transfer requirement is described below.

Process Steps
1.The usage decision in QM has not yet been made.
When you create the transfer order for the transfer requirement, the system displays a dialog box with information about the inspection sample quantity calculated by QM. You can decide at this point what to do with the sample quantity in WM.

The entries required in the dialog box can be preset in Customizing. Using an additional switch, you can control whether the dialog box is to be processed in the background or in the foreground with the values from Customizing.

If all the required entries exist in Customizing, this makes it possible to process such transfer requirements via direct or automatic transfer order creation.

The following options are available in the dialog box:
a.Sample quantity remains in the goods receipt area
This means that the sample quantity is deducted from the quantity to be placed into stock. Standard stock placement transfer orders are created for the remaining quantity.

In the inspection lot, the system records that the inspection sample quantity has been retained at the goods receipt area. In the transfer requirement, this quantity is kept as the open quantity. Further processing of this open transfer requirement quantity is only possible after the usage decision has been made.
b.Transfer inspection sample quantity to the inspection sample storage bin
At this point, you can either enter the storage type and the storage bin manually or you can have these determined by the system based on the defined stock placement strategies. You can overtype the pallet quantities proposed by the system or you can select the option “Round off to full pallets”. The system creates a transfer order item for each pallet. When you create the transfer order, the storage bin determined and the transferred quantity are entered into the inspection lot. If the inspection sample quantity is not supplied in full, the dialog box will be displayed again with the next stock placement for this transfer requirement. The storage type and the storage bin can no longer be changed. The remaining quantity is displayed on the screen.
c.Place quantity into storage
This means that the entire transfer requirement quantity is placed into stock. In the inspection lot, the system records that the inspection sample quantity is stored in an unknown storage bin. In the inspection lot, the storage bin entry is deleted.
d.Skip the transfer requirement item
This means that no transfer requirement is created for this transfer requirement item. The data in the inspection lot is not updated. This transfer requirement item remains open and can be processed at a later time.

SAP recommends using option a or b.If IM postings that relate directly to the inspection sample quantity arise from the usage decision in QM (goods issue to inspection sample or goods issue to returns), these postings take place in WM in the storage bin that is noted in the inspection lot so that no additional transfer order is required for this posting. Any open transfer requirements are canceled. Transferring the quantity to an inspection sample storage bin is appropriate if the sample is damaged during the inspection or if the inspection posting is complete. If the goods receipt quantity is always handled in the same way after the inspection has been closed (for example, release the entire quantity or return the entire quantity to the vendor), then you should decide on option a since, in this case, you always have an open transfer requirement that you can use to transfer the inspection sample quantity.
2.The usage decision is already made
The stock placement transfer requirements are processed as if QM did not exist. The transfer requirement does not receive an inspection lot number and no dialog box is displayed.

Make sure whenever you have inspection stock (and this stock belongs to different inspection lots) that the quants of these materials do not get mixed up in the storage bins. This can happen especially if you are using stock placement strategy “I “ (addition to existing stock), “C” (open storage) or “B“ (bulk storage). In the quant, only one inspection lot can be recorded. If the quant amount of a material belongs to different inspection lots, WM can no longer select the correct quants automatically based on a usage decision (for example, returns to vendors).
Examples: Making a Usage Decision
Based on the usage decision in QM, there can be three different action types in WM:
1.Posting changes
For posting changes from quality inspection to unrestricted-use stock, a posting change notice and 2 interim storage quants are created in WM. When you create a transfer order for this posting change notice, WM automatically selects all quants for this inspection lot no matter where the material is located in the warehouse. If a transfer requirement still exists for this inspection lot, the material data in this transfer requirement is changed in accordance with the posting change notice (in this case the stock category is changed from “Q” to “available”). If you decided to retain the inspection sample in the goods receipt area, this transfer requirement remains open and must still be processed.
2.Picks
Material is returned to the vendor, or there is a goods issue to scrap or a stock transfer to another storage location. In this case, a negative quant is created in WM in the goods issue interim storage area. If there is still a stock placement transfer requirement for this inspection lot, it is reduced by the stock removal quantity.

Depending on the setting in the movement type, the system creates a transfer requirement for the stock removal. An exception to this is when the interim storage bins in the transfer requirement to be created and in the transfer requirement to be canceled are the same. In this case, the system does not create a stock removal transfer requirement.

In WM there is no stock placement before the usage decision, that is, the complete goods receipt quantity remains in the GR Area (interim storage area for goods receipts) and the stock placement transfer requirement is completely open. The usage decision triggers off the process “Return to vendor”. Now, if the movement type of the return delivery is set so that the dynamic coordinate “Purchase order number” is used, the interim storage quant is balanced, the stock placement transfer requirement is canceled, and no new transfer requirement is created. Therefore, if the complete GR quantity is to be returned to the vendor, no further actions in WM are required.

If the goods receipt quantity is already placed into stock and if it has to be removed again on the basis of the usage decision, the system will only select those quants that belong to the respective inspection lot when the stock removal transfer requirement is being converted into a transfer order. If the system cannot automatically select quants for the required stock removal amount, you can display the material stocks without inspection lots from the stock overview during transfer order creation. For this purpose, choose Edit → Inspection lot → Ignore from the stock overview.
3.Direct postings from the inspection sample storage bin
This process is only supported for inspection sample quantities that can be posted from the usage decision for “goods issue to inspection sample” and for “goods issue to returns”.

If the inspection sample quantity for each transfer order is reposted during goods receipt to an inspection sample storage bin, the stock in this storage bin is reduced by the two postings directly from the usage decision. No further action in WM is necessary.

If the inspection sample quantity remains in the goods receipt area during the goods receipt process, there is also a stock reduction in this storage bin. Also, the open transfer quantity is reduced by the respective quantity. No further actions are required in WM.

Automatic transfer order processing in the background
As a rule, automatic transfer order creation in the background is possible for all processes directly from the usage decision. This can be set in the movement type in the WM Customizing application.

Automatic transfer order creation is prevented internally by the system if more than one IM posting is created for which a transfer order is to be created automatically. The reason is that in this case the automatic quant determination is not possible during transfer order creation. The postings “GI to inspection sample” and “GI to returns” are exceptions if the respective quantity is in the inspection sample storage bin or still in the goods receipt area.

Table: Clarification of Logic

It is understood that for all the movement types involved, the setting “automatic transfer order creation” is defined.

Finding an Inspection Lot in the Warehouse
To find all materials belonging to an inspection lot in the warehouse, you need to know the inspection lot number. The system enters this number into the WM quant. You can view quant information from any stock display list in WM.

Reference – https://help.sap.com

Double-click .–> Define storage type search (as necessary)

Double-click . Activate QM in storage type search.

1.1.1     Define Production

Maintain Production Supply Area

IMG  Logistics Execution  Warehouse Management  Interfaces  Define Production

Assign Replenishment Movement type

 

WM-PP

  1. WM-PP Basic:

 

1.1          Maintain Production Supply Area

Sequence: SPRO->IMG->LE->WMS->Interfaces->Define Production

T Code: OMK0 – or – (Through SAP Menu) PK05

Data entered  (with movement type): Give – Plant (for which you would like to make PSA) – > System shows the table for PSAs already existing (if any) with possibility to check the PSA wise details with magnifying glass – > there you have to enter a combination of – Plant-Supply Area-Storage Location

Documents created: PSA No. PVBV351 MICO WM Test PSA created

Overview:

The production supply area exists directly in the production area. You stage the material in the production supply area in Production storage bins. so that it can be removed directly for production.

The production supply area groups together work centers near to production storage bins, taking the material staging type into consideration.

You create the production supply area per plant and storage location in the Customizing for Warehouse Management under Interfaces ® Define Production ® Production Supply Area ® Maintain. You group together the work centers under supply areas, based on the work center master data. To control material staging you define the supply area in the BOM or the material master of the component.

During production supply area determination, the system takes the supply area from the work center master data during production supply area determination. If no information on the supply area is available there, the system first searches in the BOM and then in the material master for the source supply area.

If you have assigned a material to several supply areas within the same storage location, the system displays all of the material stocks in the assigned supply areas in the stock overview for the storage location.

Screen:

  • Create Production Storage Bin

Sequence: SAP Menu-> Logistics->Logistics Execution ->Master Data -> Warehose->Storage Bin-> Create ->Manually

T Code: LS01N

Data entered  (with movement type): Wh.No.->St.Ty.->Storage Bin No.->Storage Section No.-> then you can save the master record created.

Documents created: For Wh.No.001 / St.Ty. -100 & St.Sec.001 – > St.Bin No. Production created.

Overview:

You define production storage bins in the Prodcuction Supply Area. You stage materials for production in these storage bins.

For each material and  control cycle you define a production storage bin, in which the corresponding material is to be staged for production.

You define the production storage bin as a storage bin that you create and manage with the Warehouse Management system (WMS). You can use both physical and Dynamic Storage Binsas production storage bins.

You create the dynamic storage bin “production order” in the control cycle for pick parts. The system then stages all the materials for a specific production order in a dynamic storage bin with this production order number.

The WM-PP interface ensures that materials are staged for production in predefined production storage bins. In doing so, the system executes all stock postings at production storage bin level.

To avoid stock differences during goods issue posting for material consumption in Inventory Management (MM-IM), you must only remove the material for production from the predefined production storage bins.

Screen

  • Create Control Cycle

 

Sequence: SAP Menu-> Logistics->Logistics Execution ->Master Data -> Warehouse->Production Supply -> Control Cycle Production Supply -> Create

T Code: LPK1 (to create) LPK2 (to change)

Data entered  (with movement type Documents created: Material No. Plant ; Supply Area ; Staging Indicator (3-Pick List Item)

Overview:

You use the control cycle to define for your plant the Production storage bin in which a certain material is to be staged for production and with which staging type, within a Prodcution supply Area.

Using the control cycle, you can support several types of material staging in the WM-PP interface. You define the type of material staging for each material in the material master using the Material Staging Indicator:

  • Pick Parts: For pick parts, you can define one control cycle per production supply area for all materials. This control cycle is then valid for all of the materials in the production supply area, for which you have not defined an individual control cycle.

  • Create Parts

  • Release Order Parts: You cannot create any control cycles for multiple materials for release order parts, due to system performance. To create or change control cycles for release order parts in large numbers, choose Logistics ® Logistics Execution ® Master Data ® Warehouse ® Production Supply ® Control Cycle Production Supply ® Change Control Cycles for Release Order Parts from the SAP menu.

  • Manual material staging: You execute manual staging without reference to a production order. The material is staged in the production storage bin that you have defined in the corresponding control cycle.

For manual staging, you can define one control cycle per production supply area for all materials. This control cycle is then valid for all the materials in the production supply area, for which you have not defined an individual control cycle.

  • No WM staging : Materials with this indicator cannot be staged via the WMS.

In additional, you clearly define in the control cycle the production storage bin, in which the particular material is to be staged. For this, you must have defined a WM-managed production supply area in the material master or in the BOM.

To create a control cycle, choose Logistics ® Logistics Execution ® Master Data ® Warehouse ® Production Supply ® Control Cycle Production Supply ® Create in the SAP menu.

To display a control cycle, choose Logistics ® Logistics Execution ® Information System ® Warehouse ® Production Supply ® List of Control Cycles in the SAP menu.

The system manages control cycles with the help of number ranges, which you define in the application component Production Planning. You should therefore ensure that number ranges exist for control cycles before implementing the WM-PP interface. To create number ranges for control cycles, see Kanban — Define Number Range for Control Cycle in the Customizing for Production.

Screen:

  • List control cycles

Sequence: SAP Menu-> Logistics-> Logistics Execution ->Master Data -> Warehouse – >Production Supply – >Control Cycle Production Supply-> Display -> List

T Code: LS41 (List)  ;LPK3 (individual)

Data entered (with movement type Documents created: You can give any combination of -OR- all the three – Material; Plant; Production Supply Area

Screen:

  • Create Transfer Requirement

Sequence: SAP Menu-> Logistics-> Logistics Execution ->Internal Wh.Processes -> Transfer Requirement-> LB01-Create

T Code: LB01

Data entered (with movement type Documents created:

Movement type – Replenishment for Production

319 – Std SAP

918 – UBK-RM

Screen:

:

 

  • Create TO for the TR

Sequence: SAP Menu-> Logistics-> Logistics Execution ->Internal Wh.Processes -> Stock Transfer -> Create Transfer Order ->By Replenishment -> LT04 By TR

T Code: LT04

Data entered (with movement type Documents created:   with Mv.Ty.918 (UBK-RM) or 319 (Std SAP) TO created

Screen:

Confirm TO (LT12)

Replenishment for Fixed Bins in WM

 2.1 Material master

Process: Maintain the details in the material master required for internal replenishment (FNL) for fixed storage

T Code: MM01/MM02

Data entered (with movement type Documents created: Material Master should exist for the storage type FN1 or any FNL st.ty. (or which you would like to do ‘replenishment’)  in WM1 View; give Storage Type indicator fr stk removal and stk placement; in WM2 View give the fixed storage bin number that will be used in FNL st ty; also give the Min (given as 500 here) & Max (given 1000 here) quantities that are of relevance.

Screen:

2.2 Strategy for  Stringent FIFO

Process: The FNL area that is being used should be excluded from Stringent FIFO.

Sequence: SPRO-> LE-> WM -> Strategies -> Picking Strategies -> Define Strategy for

FIFO

T Code: OMM8

Data entered (with movement type Documents created: In ‘Exception for indv. St.ty.’ option – for a Wh.No.-St.Ty (give FNL no.) you should tick mark in the column ‘ No Stringent FIFO’.

Screen:

  • Replenishment for Fixed Bins in WM

Process: To replenish the required FNL area

Sequence: Logistics >LE> Outbound process> GI>Picking> Planning for Replenishment

T Code: LP21

Data entered (with movement type Documents created: Plant – 934A; S.Loc – 9401; Wh.No. – 001; St.Ty. – FN1; requirement type – N + some dummy no.; Planned Date – is the date of replenishment date; In screen control block choose – foreground option. After this data entry, press execute button (or F8 key) .

Documents Created:  System take you to the next screen called as – ‘WM Replenishment : Overview Fixed Bins’ where it lists down the replenishment lines that gets generated.

Remarks: Here you can check the details of the system calculations by clicking magnifying glass. The principle used is – Guranteed material staging, which means that if Max.Qty. is 1000, if current qty in FN1 is 200, then system will generate the  repleneshiment requirement of 800 provided in warehouse unrestricted qty 800 or more quantity is available; if the qty available is less that 800, for ex. 400, then system will generate the replenishment req. of only 400.

Screen:

Note: This works on Min-Max           quantity, which is maintained in Material-Master.

If the Production Bin has stock more than the Min Quantity, then No replenishment can be made,

E.g. Here the Bin has 12 qty, and if the min quantity is less than 12, then no replenishment is Possible.

But since the Min quantity now maintained in Material master is 8,500 and the bin has only 12 qty, replenishment can be done    Max = 20,000

 

Press ‘Material Staging’ button on the screen.  If the staging of material is done successfully, system gives the message – ‘ Staging of material processed without errors’.

Note: Here in the background, system generates the TR (trf. req.) which then is to be converted in to TO and TO should be confirmed to issue the material to production.

  • Creation of TO from TR

LB11:  and then LT12

    1.  Replenishment for Storage Types with random Space Management

3.1 Material master

Process: Maintain the details in the material master required for internal replenishment (FNL)

for fixed storage

T Code: MM01/MM02

Data entered (with movement type Documents created: Material Master should exist for the storage type FN1 or any FNL st.ty. (or which you would like to do ‘replenishment’)  in WM2 tab page; give Storage Type indicator fr stk removal and stk placement; in WM2 tab page DO NOT give the fixed storage bin number as that was given for LP21 used in FNL st ty; also give the Min (given as 500 here) & Max (given 1000 here) quantities that are of relevance.

Screen: Material type FERT

3.2 Strategy for  Stringent FIFO

Process: The FNL area that is being used should be excluded from Stringent FIFO.

Sequence: SPRO-> LE-> WM -> Strategies -> Picking Strategies -> Define Strategy for Stringent FIFO

T Code: OMM8

Data entered (with movement type Documents created: In ‘Exception for indv. St.ty.’ option – for a Wh.No.-St.Ty (give FNL no.) you should tick mark in the column ‘ No Stringent FIFO’.

Screen:

3.3 To replenish the required FNL area

Sequence: Logistics >LE> Outbound process> GI>Picking> Planning for Replenishment

T Code: LP24

Data entered (with movement type Documents created: Plant – 934A; S.Loc – 9401; Wh.No. – 001; St.Ty. – FN1; requirement type – N + some dummy no.; Planned Date – is the date of replenishment date; In screen control block choose – foreground option. After this data entry, press execute button (or F8 key) .

Documents Created:  System take you to the next screen called as – ‘WM Replenishment : Overview Fixed Bins’ where it lists down the replenishment lines that gets generated.

Remarks: Here you can check the details of the system calculations by clicking magnifying glass. The principle used is – Guranteed material staging, which means that if Max.Qty. is 1000, if current qty in FN1 is 200, then system will generate the  repleneshiment requirement of 800 provided in warehouse unrestricted qty 800 or more quantity is available; if the qty available is less that 800, for ex. 400, then system will generate the replenishment req. of only 400.

Screen:

Note: Here in the background, system generates the TR (trf. req.) which then is to be converted in to TO and TO should be confirmed to issue the material to production

Then Go to LB11 to Create TO from TR and then confirm in LT12

    1. Stage Remaining Material Quantity for Production Order

Process: Stage remaining material quantities for a production order

T Code:  LP10

Perquisite:

The pre-requisite for this transaction –
1. A Production Supply Area should exist.
2. A control cycle with Mat.Stg.Ind 1 (for pick parts) should exist.
These transactions are not repeated in the list of steps given below in this sheet.

Data entered (with movement type Documents created: Production Order is required.

Screen:

Kanban

  1. Introduction

The KANBAN method for controlling production and material flow is based on the actual stock quantity in production. Material that is required on a regular basis is continually provided in small quantities in production. Replenishment or the production of a material is only triggered when a higher production level actually requires the material. This replenishment is triggered directly in

production using previously maintained master data.

In KANBAN, the signal for material replenishment can be triggered, for example, by the work center that requires the material (demand source) by sending a card to the work center that is

responsible for manufacturing the material (supply source). This card describes which material is

required, the quantity of the material required and where the material is to be delivered. The name KANBAN originally stems from these cards, which are called “kanban” in Japanese.

 

Overview: KANBAN is a planning process where production itself will take care of planning.
In simple terms KANBAN is a card which has the details about the DEMAND source, Supply source, Quantity, Recieving location Etc.

Ii is controlled through Control cycle where you will maintain the type of KANBAN, Replenishment strategy(Example; INHOUSE, EXTernal sto etc)

the replenishment is controlled via KANBAN Status. if EMPTY then it willl trigger replenishment and once recieved it will be set to FULL. when in use it will be in INUSE status.

There are four types of KANBAN In SAP

1. Classic KANBAN :

In the classic KANBAN production control method, the demand source, the supply source and the procedure to be used to replenish the material are defined in the control cycle as well as the number of kanbans that circulate between the supply source and the demand source and the quantity per kanban.

In this classic KANBAN procedure, the kanban signal always only triggers replenishment for the kanban quantity defined in the control cycle. Moreover, you cannot circulate more kanbans than are defined in the control cycle without changing the control cycle first.

  1. KANBAN with Quantity Signal:

In the classic KANBAN procedure, after the kanban has been completely emptied, the employee in production uses the kanban signal to set the status of the kanban to EMPTY. At no point before the kanban is set to EMPTY is the system informed of the quantity still in the kanban.

Using the quantity signal, the employee in production does not trigger the kanban signal for replenishment manually by setting the kanban status to EMPTY. Instead, the employee in production or a PDC System enters the individual withdrawal quantities in the system directly. The system subtracts each of these withdrawal quantities from the actual kanban quantity and when the kanban quantity is zero, the system automatically sets the status of the kanban to EMPTY.

In KANBAN with quantity signal, you can also use all the functions available in the KANBAN module.

For KANBAN with quantity signal, no further prerequisites are necessary.

In KANBAN with quantity signal, a separate function is available for entering the withdrawal quantity.

The actual kanban quantity is reduced by the withdrawal quantity entered at each posting. The system recognizes when the actual kanban quantity is zero and automatically sets the kanban to EMPTY. The procedure in detail is as follows:

The first time a quantity is withdrawn from a kanban, the system sets the status to IN USE. Once the kanban is completely empty, the status is set to EMPTY and replenishment is triggered. If the withdrawal quantity exceeds the remaining quantity of this kanban, the system reduces the actual quantity of the next kanban, which is then set to IN USE.

The sequence of the kanbans from which you can withdraw material is determined as follows:

  • First, the system empties kanbans with the status IN USE.

  • Then the system selects the kanban that has been set to the status FULL the longest.

Therefore, in this procedure (as opposed to KANBAN without a quantity signal), the actual kanban quantity is of functional importance.

The system sets the kanban to FULL as normal with the kanban signal.

Only the actual quantity of the kanban is updated when you use the quantity signal – no stock postings are carried out. The system does not post the inventory data until the status has been changed to EMPTY.

For technical reasons, it is not possible to create several production orders for several kanbans all at once. The system does not allow such an entry.

Change your entry or the business process so that only one kanban is created. For example, make several entries, each with smaller quantity.

If this is not possible, change your replenishment strategy from production orders to planned orders/run schedule quantities.

  1. One-Card KANBAN:

The purpose of this process, amongst other things, is to create a one-card KANBAN system with two kanbans in a control cycle. As a kanban is set to the status WAIT for certain periods in a control cycle, you can further reduce the inventory level at the demand source – especially during periods when the material is not required. In this procedure, replenishment is always triggered when the kanban that is currently being emptied is approximately half empty. The new kanban is then delivered before the current kanban is completely empty. This logic is illustrated in the following graphic:

To be able to guarantee the replenishment of the kanban currently in use, two kanbans are active some of the time in the one-card system. Therefore, this logic requires the use of two kanbans in the system.

In the one-card KANBAN procedure, you can also use all the functions available in the KANBAN module.

Before you can use this procedure, you must select one of the processes in the field, Trigger replenishment when maintaining the control cycle.

  • Triggering replenishment at status IN USE:

After the first container is reported full, the system proceeds as follows: The second kanban is set to the status WAIT. If a new kanban is requested, the system sets the full kanban to the status IN USE. With this status change the kanban with status WAIT is automatically changed to status EMPTY and thus replenishment is triggered. When this new kanban is delivered, it receives the status FULL. As soon as the kanban from which material is still being withdrawn is set to EMPTY, the system automatically sets it to status WAIT and the process is repeated.

This procedure is illustrated in the following graphic:

  • Triggering replenishment at status WAIT:

After the first container is reported full, the system proceeds as follows: When a new kanban is requested, the full kanban is set to status EMPTY. With this status change the kanban with status WAIT is automatically changed to status EMPTY and thus replenishment is triggered. The kanban from which material is still being withdrawn receives the status WAIT. When the new kanban is delivered, it receives the status FULL and the process is repeated. As opposed to the logic with the status IN USE, you do not have to work with an additional status here. On the other hand, you have no possibility in the system of seeing whether a container is currently being emptied.

This procedure is illustrated in the following graphic:

  • Reaching or exceeding the trigger quantity:

The procedure here is similar to the two procedures described above. However, the difference here is that the kanban is set to EMPTY when the remaining quantity in the kanban reaches or exceeds the trigger quantity. In this process, the parts are withdrawn with the quantity signal. In this case, you must maintain the trigger quantity as well as the logic in the control cycle. This process is particularly useful for parts that are not used on a regular basis. Therefore, you can procure parts with KANBAN without having to keep several containers in stock. However, a PDC system is required for this procedure.

  1. Event-Driven KANBAN:

 In event-driven KANBAN, material provision is not based on a predefined number of kanbans or a predefined kanban quantity. Instead, it is based on actual material consumption. The material is not continually provided and replenished at a supply area. It is only replenished when specifically requested. In this procedure, the advantages of the KANBAN module are used to make the material replenishment process even more simple.

In the event-driven KANBAN procedure, you can also use all the functions available in the KANBAN module.

You must maintain separate control cycles for event-driven KANBAN.

In this procedure, a kanban is only created when required. That is, kanban creation is triggered by a certain event. The system creates a kanban for every requested material quantity, which is subsequently deleted on replenishment.

The event-driven kanban is created using a separate function. The quantity to be replenished is defined directly in this function. In the control cycle, you can define the following restrictions for the definition of the kanban:

  • You can enter a rounding quantity to round up the required quantity.

  • You can enter a fixed kanban quantity. If the requested quantity is smaller than the fixed kanban quantity, the system replenishes the fixed quantity. If the required quantity is greater than the fixed quantity, several kanbans (for the fixed quantity) are replenished until the required quantity is covered. Here, if necessary, the required quantity is rounded up to a complete multiple of the fixed quantity.

  • You can define a proposal value for the required quantity. This value is used by the system if no quantity has been specified in the function for creating the event-driven kanban.

For technical reasons, it is not possible to create several production orders for several kanbans all at once. The system does not allow such an entry.

Change your entry or the business process so that only one kanban is created. For example, make several entries, each with smaller quantity.

If this is not possible, change your replenishment strategy from production orders to planned orders/run schedule quantities.

  1. Using a separate transaction, the kanban signal is triggered which creates one or several kanban(s). The quantity or the number of kanbans depends on the required quantity and the specifications in the control cycle. A replenishment element is created for each kanban created depending on the strategy.

  2. Replenishment is carried out.

  3. The kanban is set to FULL and, if necessary, a goods receipt is posted.

  4. When you set the kanban to EMPTY (for example, using either a bar code or the kanban board), the system deletes the kanban.

  5. A new kanban or new kanbans with replenishment element is/are not created again until you retrigger the kanban signal using the function, Event-driven kanban.

In UBK, qty is maintained in KANBAN card only but not in control cycle as shown below

  1. You have to create control cycle for materials which you want to use in KANBAN. Define the Supply area,Storage BIn,No of KANBAN(containers),Capacity of KANBAN etc in the Control cycle.


2.You have to create Replenishment strategies External,Internal and stock transfer procurements
3.Define Number Ranges for KANBAN
4.Maintain Supply areas in customization and assign it on the material master
MRP-2 view – Default supply area

Some Tcodes for KANBAN
1.Create Control cycle PK01
2.Create Supply area PK05
3.KANBAN board Demand Source view PK13N
4.KANBAN board Supply source Source view PK12N
4.KANBAN Back flush PK41
5.KANBAN JIT Goods Receiept PJWE

IMG Activities

IMG–>Production–>KANBAN–>Define Number Range for Control Cycle ,
Define Replenishment Strategies–>Define Inhouse,Externale,Stock Transfer Strategies
Define Number range for JIT calls
Maintain Short text for Container status
Define number rangee for JIT calls

  • What is Milk Run ?

It is physical process in which ROH matl required for prodn will be replenished to that supply area. A milk runner will collect a KANBAN cards from a particular supply area and hand over it to Supermarket people and they will scan KANBAN card and replenish materials to milk run vehicle.

  1. Master Data

  • Supply Area

Definition       

A supply area is an interim storage location on the shop floor which is used to provide material directly to the production line or the work center.

The supply area can be a shelving area, an area marked off on the ground, special boxes and so on. Defining the supply areas for a plant is part of the material flow design for KANBAN.

The supply area is defined in Customizing and is assigned the following objects:

  • Plant

  • Storage location

  • Person responsible

Goods movements are posted to the storage location assigned to the supply area.

One storage location can be assigned to several supply areas, however, one supply area cannot be assigned to several storage locations.

The person responsible is the person who (as the demand source) monitors the further processing of the materials and the stocks at the supply area.

Define the Supply Area (PK05)

Enter Plant for which supply area to be maintained then press enter key.

Enter the details as in the above screen like Supply area and description, KANBAN storage location (IM managed)  Responsible and unloading point (Optional). Then save the transaction.

  • Control Cycle

Definition

The control cycle defines the relationship between the demand source and the supply source.

The control cycle contains the following control data for KANBAN production:

  • Kanban circulation, that is, the number of kanbans and the kanban quantity

  • The basic data required for automatic kanban calculation, if necessary

  • Replenishment strategy

  • Printing kanbans, if necessary

  • The delivery address, if necessary

  • The process control (for example, indicator for separate goods receipt, status sequence key, indicator for the logic for triggering replenishment for ‘one-card’ KANBAN), if necessary.

    • Creating Control Cycle for Classic KANBAN (PK01)

 In the classic KANBAN production control method, the demand source, the supply source and the procedure to be used to replenish the material are defined in the control cycle as well as the number of kanbans that circulate between the supply source and the demand source and the quantity per kanban.

In this classic KANBAN procedure, the kanban signal always only triggers replenishment for the kanban quantity defined in the control cycle. Moreover, you cannot circulate more kanbans than are defined in the control cycle without changing the control cycle first.

Enter the Material, plant , supply area and select Classic KANBAN as above then press enter it take you to below screen.

Define the following parameters:

  • Replenishment strategy

In the control cycle you define how replenishment between the supply   source and  the demand source is to be organized.

  • Kanban Circulation

For kanban circulation you need to define the following:

  • Number of kanbans that circulate between the supply source and the demand source

  • Material quantity per kanban.

The number of kanbans as well as the kanban quantity is based on the following criteria:

  • Average consumption

  • Replenishment lead time of a kanban

  • Fluctuations in consumption and in the replenishment lead tim

  • Creating Control Cycle for Event-Driven KANBAN (PK01)

                  In event-driven KANBAN, material provision is not based on a predefined number of kanbans or a predefined kanban quantity. Instead, it is based on actual material consumption. The material is not continually provided and replenished at a supply area. It is only replenished when specifically requested.

Enter the Material, plant , supply area and select Classic KANBAN as above then press enter it take you to below screen.

Define the following parameters:

  • Replenishment strategy

In the control cycle you define how replenishment between the supply source and the demand source is to be organized.

  • Kanbans

In event-driven KANBAN, the number of kanbans and the kanban quantity are not defined in the control cycle. Only the following basic data is maintained in the control cycle:

  • Quantity per kanban:

Kanban quantity proposed by the system when no order quantity is entered when creating the kanban signal.

  • Rounding quantity:

When creating the kanban signal, the requested material quantity for this kanban is rounded up to the next complete multiple of the rounding quantity. The rounding quantity must be a multiple of the fixed kanban quantity.

  • Fixed kanban quantity:

Defines a fixed quantity of material per kanban and is used in the sense of afixed lot size. This means, the system can only create kanbans for this material quantity.

  • Replenishment Strategy

Definition

The replenishment strategies define in the control cycle how replenishment is to take place:

  • Using in-house production

  • Using external procurement

  • Using stock transfer

The replenishment strategies also determine whether and which replenishment elements (run schedule quantities, production orders, and so on) are created by the kanban signal.

The replenishment strategy is assigned to the material in the control cycle.

  • In-house Production Strategies

There are several replenishment strategies available for in-house production.

  • Replenishment Using Manual KANBAN

  • Replenishment Using Run Schedule Quantities

  • Replenishment Using Production Orders.

Click on the above node the below screen appears

Click the button -New Entries- the below screen appears

Enter the Required details like Control type, Goods Receipt movement type.

  • External Procurement Strategies

There are several replenishment strategies available for external procurement.

  • Replenishment Using Standard Purchase Orders

  • Replenishment Using Stock Transfer Orders (Plant to Plant)

  • Replenishment Using Scheduling Agreement

  • Replenishment with Summarized JIT Calls

The Control type indicates what type on replenishment strategy.

  • Stock Transfer Strategies

There are several replenishment strategies available for stock transfer.

  • Replenishment Using Reservation

  • Replenishment Using Direct Transfer Posting

  • Replenishment with WM Based Storage Locations

  • Transfer Posting Using Replenishment Elements from MRP

  • Replenishment from WM Based Storage Locations

Enter the details as in the above screen, press enter key and save the data.

 

  • Define Number Range for KANBAN id Number

Click on Execute  the below screen appears

Enter the details like serial number, from number and to number then press enter key and save the data.

 

  • Define Replenishment Strategies

 

  • In-house Production Strategies

Click the button  -New Entries the below screen appears

  • External Procurement Strategies

 

Enter the details as shown above. Similarly all the strategies has to be created for Stock transfer.

  1. Process Background

 

The KANBAN method for controlling production and material flow is based on the actual stock quantity in production. Material that is required on a regular basis is continually provided in small quantities in production. Replenishment or the production of a material is only triggered when a higher production level actually requires the material. This replenishment is triggered directly in

production using previously maintained master data.

In KANBAN, the signal for material replenishment can be triggered, for example, by the work center that requires the material (demand source) by sending a card to the work center that is responsible for manufacturing the material (supply source). This card describes which material I required, the quantity of the material required and where the material is to be delivered. The name KANBAN originally stems from these cards, which are called “kanban” in Japanese.

If you want to make full use of the KANBAN technique, your production must fulfill a number of

preconditions:

  • The consumption of the kanban parts should be relatively constant within an interval which is longer than the replenishment lead time of a kanban. If large quantities of a material are required for a certain period, and then the material is not required at all for a certain period, a large number of kanbans are required to guarantee material availability. This means that relatively high inventory levels exist when the material is not required.

  • The supply source has to be able to produce a large number of lots within a short interval. To this end, the setup times in production have to be reduced to a minimum and the reliability of production has to be increased. Waiting until several kanbans for one material have been sent to the supply source before starting production defeats the whole point of the KANBAN method of production.

  1. Process Flow

PP KANBAN Process

  1. Create Supply Area (PK05)

Enter Plant for which supply area to be maintained then press enter key.

click on new entry button.

Enter the details as in the above screen like Supply area and description, KANBAN storage location (IM managed)  Responsible and unloading point. Then save the transaction.

  1. Define Replenishment Strategy

Maintain the required details external proc, control type , order type and movement type for goods receipt.

 

Similarly other strategies can be maintained for other replenishments

 

  1. Maintain material master

Enter the prod. Storage location, supply area, backflush indicator and JIT delivery sched.(For JIT calls)

  1. Create Scheduling Agreement (ME31L)

Enter the required details as shown below

 

Select the Kanban indicator as above after entering material details save the transaction SA will be created.

  1. Classic KANBAN

  1. a) Create Control Cycle (PK01)

Enter the Material, plant , supply area and select Classic KANBAN as above then press enter it take you to below screen.

Select the external procurement release strategy like 0002 as above then fill up the details of Purchase order/ SA. Enter the No. of kanban, kanban qty and maximum empty.

Then in flow control tab you can maintain further controls like Separate GR posting when Kanban status changes.

For calculating the KANBAN qty you have to maintain the details in this tab.

Then save the control cycle.

b) KANBAN Board (PK13N)

Enter the Plant supply area for storage location and supply area(If you want only selected supply area Kanban cards to be displayed) then press enter key.

If you double click on the green card it will give you the below details.

 

  1. Event Driven KANBAN
    1. Create Control Cycle (PK01)

Enter the details as above and press enter key below screen appears

Enter Kanban Qty(Should be multiples of Rounding Qty), Choose the release strategy 0002 for external procurement and enter the SA details as shown in above screen.

Enter the details as in the above screen. The Qty Requested field is for Kanban requirement qty if its blank then system will take the Kanban qty from control cycle and creates KANBAN for that qty. after entering all details save the transaction then below details appears

In the above screen 6 lots are created as the Fix kanban qty is 15 and requested qty was 65, then its rounded to qty 90. Once Kanban is created then it creates the empty kanban cards with qty 15 on each cards along with this it creates schedule lines for the scheduling agreement with 15 qty for each line.

After receiving the material set the kanban status to FULL and GR will be posted in background.

After consumption if you set the FULL status to EMPTY then that kanban will be deleted from the KANBAN Board.

c) Quantity Signal Input (PK22)

You can also set the Kanban status to EMPTY by passing the quantity signal.

After saving the below details appears and kanban status is changed to EMPTY and will be deleted.

I hope the details given here will support the understanding of Control cycle with KANBAN Process. KANBAN having its origin in JAPAN.

 http://www.sapfunctional.com/WM/WMQ1.htm

 

SAP Warehouse Management_Step by Step configuration Document

SAP WM –Process, Functionality, Scope, Benefits, Advantages, Disadvantage- Complete Reference-Part 1

SAP WM- Process, Functionality, Scope, Benefits, Advantages, Disadvantage-Complete Reference-Part 2

 

***** I hope I have SAP WM Topics in an procedural Manner. Please leave your comments. So that it is useful for me to correct or enrich the knowledge stuff shared here. Corrections are highly appreciated here. Please do not hesitate to share your valuable review or comments. Thanking you everyone. In My Next Blog Article we will continue with SAP WM Concepts. One More important thing here is people have in mind why i have done back step in explaining the WM basic concepts and real time Warehouse functionality ? because to explain the fundamentals in elaborate manner based on the request from our friends reading the article. Thanking you all again.

In continuation to part-3 I have explained RF Process in SAP WM in Part-4

 

SAP WM- Process, Functionality, Scope, Benefits, Advantages, Disadvantage-Complete Reference-Part 4

 

 

 

 

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6 Comments

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  1. Joachim Rees

    Hi shivakkumar,

     

    I did only quickly scan this one (not read it in detail) but I can tell that it seems really helpful!

    I especially like the Process Flow Diagram with the TCODEs included.

    Thanks a lot for sharing, I’ll recommend this to anyone wanting to learn/understand WM!

     

    Best

    Joachim

     

    [Edit: PS: I noticed you use lots of secondary tags, maybe you could thin taht out a little – especially the “EWM”-Tags seem un-fitting to me!.]

    (0) 
    1. shivakkumar Geetha venkatesan Post author

      Thanks Joachim for the valuable review and Suggestion. Yes now I have removed the EWM Tags. My intention is that article if useful to some extent to all. that is more happy to me. suggestion are always invited and appreciated. Gr8. Have a Good Day !!!

      (0) 

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